Circle Acquires Interop Labs, Developer Behind the Axelar Network

The crypto infrastructure space is heating up again, and one of the biggest recent headlines is that Circle acquires Interop Labs, the original developer behind the Axelar Network. 

The move signals Circle’s growing ambition to dominate blockchain interoperability, especially as stablecoin usage accelerates globally.

In this article, we’ll break down what Circle’s acquisition of Interop Labs really means, why Axelar still matters after the deal, and how this could impact the future of USDC, Arc, and cross-chain finance as a whole.

Circle Acquires Interop Labs 

Circle, best known as the issuer of stablecoin USDC, the world’s second-largest stablecoin, confirmed that it has acquired key team members and proprietary technology from Interop Labs. 

Interop Labs is widely recognized as the initial developer of the Axelar Network, one of the leading interoperability protocols in crypto. As part of the acquisition, Sergey Gorbunov, CEO and co-founder of Interop Labs, will officially join Circle. 

According to Circle, the deal focuses on Interop Labs’ internal intellectual property and engineering talent, not the open-source components of Axelar. The transaction is expected to close early next year, pending standard conditions.

Why Circle Wanted Interop Labs 

Circle made it clear that the motivation behind this acquisition goes far beyond talent acquisition. The company wants to make digital assets issued on Arc interoperable across multiple blockchains.

Arc is Circle’s programmable platform for issuing and managing digital assets. By bringing in Interop Labs’ proprietary technology and engineering expertise, Circle aims to:

- Strengthen cross-chain functionality.

- Reduce friction between blockchains.

- Expand the real-world usability of USDC token and other tokenized assets.

Circle’s spokesperson highlighted that Interop Labs’ engineers are “some of the brightest minds in the industry,” underlining how critical this team is to Circle’s long-term strategy.

Axelar Network

A key concern following the announcement was the future of Axelar itself. Circle addressed this head-on. Circle clarified that it did not acquire Axelar’s open-source intellectual property. Instead, the open-source components will be transitioned to a new entity called Common Prefix.

According to Sergey Gorbunov, Axelar will continue operating as an open-source interoperability protocol, with Common Prefix taking over development and long-term support. Circle also stated that it will work closely with the Common Prefix team to ensure continuity.

This separation allows:

- Circle to integrate proprietary interoperability tech into Arc.

- Axelar to remain neutral and community-driven.

- Developers continue building without disruption.

Earlier this year, the Axelar Foundation also sold $30 million worth of AXL tokens, suggesting that the ecosystem is preparing for its next growth phase.

Circle's Bigger Interoperability Strategy

Circle’s acquisition of Interop Labs fits neatly into a much larger plan. The company has consistently invested in interoperability tools such as:

- USDC native deployments across multiple chains.

- Cross-Chain Transfer Protocol (CCTP) for seamless USDC transfers.

- Onchain infrastructure that supports institutional use cases.

Nikhil Chandhok, Circle’s Chief Product and Technology Officer, emphasized that Circle is committed to supporting many on-chain networks, just as it already does with USDC and other blockchain products.

The move positions Circle as more than just a stablecoin issuer, it’s becoming a full-stack infrastructure provider.

Potential Impact on USDC and Arc

By integrating Interop Labs’ proprietary technology, Circle could significantly enhance how USDC and Arc-issued assets function across chains.

Possible benefits include:

- Faster and safer cross-chain transfers.

- Better developer tools for multi-chain apps.

- Stronger appeal to institutions entering tokenized finance.

If executed well, this could reinforce USDC’s position as the most trusted stablecoin for regulated, cross-chain use cases.

Conclusion

The news that Circle acquires Interop Labs marks a strategic milestone for blockchain interoperability. 

Rather than absorbing Axelar outright, Circle carefully separated proprietary technology from open-source infrastructure, ensuring continuity while advancing its own ecosystem.

With stablecoin adoption accelerating and institutions moving on-chain, Circle is clearly positioning itself at the center of the next phase of crypto infrastructure. The acquisition could prove to be a defining moment in how digital assets move across blockchains in the years ahead.

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FAQ

What did Circle acquire from Interop Labs?

Circle acquired Interop Labs’ proprietary technology and key team members, including CEO Sergey Gorbunov, but not Axelar’s open-source IP.

Does Circle now own the Axelar Network?

No. Axelar remains open source and will be supported by a new organization called Common Prefix.

Why is interoperability important for Circle?

Interoperability allows assets like USDC to move smoothly across blockchains, which is crucial for scaling stablecoin and institutional adoption.

How does this affect AXL token holders?

Axelar continues as an independent open-source project. The ecosystem remains active despite Interop Labs’ transition.

When will the acquisition be finalized?

Circle expects the acquisition of Interop Labs’ team and technology to close early next year.